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More about Dealer Finance
Penal Charges (Inventory Funding - Auto & Two Wheeler)
| Sr. No. | Default/non-compliance of terms and conditions of the Transaction Documents for which penal charges may be levied. | Penal Charges as applicable |
|---|---|---|
| 1 | Overdue Penal charges for Inventory Funding | Penal charge @8% p.a. on overdue/ delays / defaults of any amount payable for inventory limits. |
| 2 | Non Submission of stock statement | Delayed/Non submission of stock statements for DP calculation of CC limits shall attract penal charges of 2% p.a. on the utilised Limits. |
| 3 | CC stock audit penal charges | Bank reserves the rights to levy penal charges @2% p.a. on the utilized limits in case of non-submission of data or non-cooperation by dealer in completing CC stock audit process. |
| 4 | Sold Out Trust (SOT) Charges | 4% p.a. penal charge to be levied on SOT amount for applicable dealers. |
| 5 | Property Document Retention charges | Property documents need to be collected within 60 (sixty) days from the date of closure of loan/ facilities linked to the collateral. Failing which, custody charges of Rs.1000/- per month per property. |
| 6 | Delayed instalment payment charge (For Term Loans) | On overdue EMI billed at contractual rate of the underlying loan for the number of days of delay. |
| 6 | Payment Return Charges | Bank reserves the rights to levy penal charges @ Rs450/- per EMI bounce |
| 6 | Premature Closure Charges (Part / Full Repayment) |
4% on Outstanding amount. As per BCSBI guidelines, for borrowers classified as Micro and Small Enterprises(MSE) NIL Premature Closure Charges will be applicable for all floating rate loans and for Fixed rate loan facility up to Rs. 50 Lakh. |
| 6 | Interest on Temporary overdrafts (TOD) | 18% per annum on the amount utilized above the available credit limit. |
| 6 | Incremental Interest on Adhoc limits | 2% p.a. additional interest on existing ROI on the amount outstanding.18% per annum on the amount utilized above the available credit limit. |
*All the above service charges/fees/Commissions are exclusive of taxes, if any.
Auto & Two-Wheeler Funding
| Sr. No. | Type of Charge | Proposed charges per instance |
|---|---|---|
| 1 | Loan Processing Charge | Minimum Rs.25,000/- & maximum upto 0.50% + GST for Auto Minimum Rs.15,000/- & maximum upto 0.50% + GST for Two Wheeler |
| 2 | Stock Audit Charges | Stock Audit Charges will be applicable at actuals per stock point basis all approved limits. |
| 3 | BG Commission & Processing Charges | Up to 2% of the facility Amount (including Processing fee & commission charges) |
| 4 | Stamp Duty & Other Statutory Charges | As per actuals which are applicable in laws of the state |
| 5 | Legal, Repossession & Incidental charges. Incidental Charges are those charges which are not budgeted or specified but are incurred by the bank on behalf of the customer | At actuals |
| 6 | Cersai Charges for creation / Modification of Security Interest on Collateral Securities. | Rs. 100 +GST |
Tractor Inventory Funding & Working Capital
| Charge Description | Current Charge |
|---|---|
| Processing Fee * | INF – Upto Rs. 25000/ - |
| CC – Upto 2% of Facility Amount | |
| TA- Nil charges | |
| Nil processing fees for loan facilities upto Rs.5 lakhs availed by Micro & Small Enterprises subject to URC submission prior to disbursal | |
| BG Commission Charges | Up to 2% of the facility Amount |
| Pre-Payment / Foreclosure Charges* | 2% on sanction limit on Inventory Funding. |
| (1). 2% if take over by another Bank | |
| (2). NIL if full outstanding repaid without takeover (own funds) | |
| Foreclosure - Term Loans/LAP/ODAP - 2% | |
| (1) Upto 25% repayment in a FY: NIL | |
| (2) For > 25% repayment & > 50 tenure completed: 1% | |
| (3) For > 25% repayment & < 50 tenure completed: 1% | |
| TA – No FC is applicable | |
| INF – 1% FC is applicable from the date of 1st acquisition to next 365 days. Post No Charges | |
| Foreclosure - Cash Credit Limits - 2% | |
| (1) 2% on CC Limits | |
| (2) NIL if full outstanding repaid, out of own sources, without takeover | |
| BG : No FC is applicable | |
| For Borrowers classified as Micro and Small Enterprises (MSE): | |
| 1.Prepayment of Fixed rate loans upto Rs.50 lakhs is permitted without levying any prepayment penalty | |
| 2. Prepayment of Floating rate loans/Takeover loans is permitted without levying any prepayment penalty | |
| Stock Audit Charges | Stock Audit Charges at Rs.1,500/- or actuals for Tractor for all exposures except TA & BG |
| SOT Charges | 2% additional Interest charge over applicable ROI once SOT is identified for dealers which are in excess of 10% of the total limits approved |
| Stamp Duty and Other Statutory Charges | At Actuals |
| Legal and incidental charges | At Actuals |
| CERSAI Charges | At Actuals |
| Solvency certificate | Upto 1%+ GST of the solvency certification value |
| Stock Gap (SOT) Charges | SOT between 10% to 20% - Rs.10000/-+GST for Tractor INF dealers per instance. SOT above 20% - Rs.25000/- +GST for Tractor INF dealers per instance |
| Penal charge on overdue amount in Inventory Funding limits | Penal charges 4% p.a + GST on overdue/ delays / defaults of any amount payable for Tractor and CV CE INF and TA dealers. |
| Delayed/Non-Submission of stock statement | Non Submission/Delayed submission of stock statements for 2 consecutively months, for DP calculation of CC limits shall attract penal charges of Rs.5000/- +GST charges for each instances of the utilized limits |
| Penal charge on overdue amount in Overdraft / Cash Credit facility / Inventory Funding limits / TA Facility | Penal charges 4% p.a + GST on overdue/ delays / defaults of any amount payable for Tractor INF and TA dealers. |
| TOD/STA Penal charge on over and above the limit utilization in Overdraft / Cash Credit /Inventory Funding/TA facility | TOD/STA Penal charges 4% p.a + GST on utilization of over and above the approved limit |
| Stock audit penal charges | Penal charges @2% p. a + GST will be applicable on the utilized limits in case of non submission of data or non cooperation by dealer in completing CC for stock audit process |
| Non submission of UFCE declaration | Flat 0.075% of the outstanding amount as at the end of previous quarter (Charges will be levied on Quarterly basis for all customers with provision amount > Rs 50,000) |
| Delayed instalment payment charge (For Term Loan) | NIL |
Commercial Vehicle, Construction Equipment Inventory Funding
| Charge Description | Current Charge |
|---|---|
| Processing Fee * | TA - Rs.25000/- |
| INF - Rs.25000/- | |
| CC – Up to 1% | |
| Nil processing fees for loan facilities up to Rs.5 lakhs availed by Micro & Small Enterprises subject to URC submission prior to disbursal | |
| BG Commission | Up to 2% of the facility Amount |
| Prepayment/Foreclosure Charges | 2% on sanction limit on Inventory Funding. (1). 2% if take over by other bank (2). Nil if full outstanding repaid without take over (own funds) Foreclosure - Term Loans/LAP/ODAP - 2% (1) Upto 25% repayment in a FY: NIL |
| (2) For > 25% repayment & > 50 tenure completed: 1% | |
| (3) For > 25% repayment & < 50 tenure completed: 1% - 2% on sanction limit on Inventory Funding. | |
| (1) 2% if take over by other Bank | |
| (2) NIL if full outstanding repaid without takeover (own funds) | |
| Foreclosure - Term Loans/LAP/ODAP - 2% | |
| (1) Upto 25% repayment in a FY: NIL | |
| (2) For > 25% repayment & > 50 tenure completed: 1% | |
| (3) For > 25% repayment & < 50 tenure completed: 1% | |
| TA – No FC is applicable | |
| INF – 1% FC is applicable from the date of 1st acquisition to next 365 days. Post No Charges | |
| Foreclosure - 2 % of the Cash Credit Limit | |
| (1) 2% on CC Limits | |
| (2) NIL if full outstanding repaid, out of own sources, without takeover BG: No FC applicable |
|
| For Borrowers classified as Micro and Small Enterprises (MSE): | |
| 1.Prepayment of Fixed rate loans up to Rs.50 lakhs is permitted without levying any prepayment penalty | |
| 2. Prepayment of Floating rate loans/Takeover loans is permitted without levying any prepayment penalty | |
| Stock Audit Charges | Stock Audit Charges at Rs.1,500/- or actuals for CV CE for all exposures except TA & BG |
| Stamp Duty and Other Statutory Charges | At Actuals |
| Legal and incidental charges | At Actuals |
| CERSAI Charges | At Actuals |
| Solvency certificate | Up to 1% of the solvency certification value |
| Stock Gap (SOT) Charges | SOT between 10% to 20% - Rs.25000/-+GST for CV CE INF dealers per instance. SOT above 20% - Rs.50000/-+GST for CV CE INF dealers per instance. |
| Penal charge on overdue amount in Inventory Funding limits | Penal charges 4% p.a. + GST on overdue/ delays / defaults of any amount payable for Tractor and CV CE INF and TA dealers. |
| Delayed/Non-Submission of stock statement | Non-Submission/Delayed submission of stock statements for 2 consecutively months, for DP calculation of CC limits shall attract penal charges of Rs.5000/- +GST charges for each instance of the utilised limits |
| Penal charge on overdue amount in Overdraft / Cash Credit facility / Inventory Funding limits / TA Facility | Penal charges 4% p.a. + GST on overdue/ delays / defaults of any amount payable for CV CE INF dealers. |
| TOD/STA Penal charge on over and above the limit utilization in Overdraft / Cash Credit /Inventory Funding/TA facility | TOD/STA Penal charges 4% p.a. + GST on utilization of over and above the approved limit |
| Stock audit penal charges | Penal charges @2% p. a + GST will be applicable on the utilised limits in case of non-submission of data or non- cooperation by dealer in completing CC for stock audit process |
| Non submission of UFCE declaration | Flat 0.075% of the outstanding amount as at the end of previous quarter (Charges will be levied on Quarterly basis for all customers with provision amount > Rs 50,000) |
| Delayed instalment payment charge (For Term Loan) | NIL |
You can apply for car Dealer Finance online by taking the following steps: SME-> BORROW-> For Business Expansion-> Business Loan-> Dealer Finance.
*The Most Important Terms and Conditions for each of our banking offerings features all the specific terms and conditions that govern their use. You must go through it thoroughly to fully understand the terms and conditions applicable to any banking product you choose.
Frequently Asked Questions
Dealership financing is a funding option tailored for dealerships, providing them with the necessary funds to purchase inventory, such as vehicles, parts, or equipment. It helps dealerships manage cash flow, maintain stock levels, and support business growth through flexible repayment terms and competitive interest rates.
Turnaround time varies. However, having all required documents ready and meeting eligibility requirements can expedite the process, ensuring quicker approval and access to funds.
The maximum loan amount varies, depending on the type of funding obtained by the dealership, but can range from several lakhs to a few crores.
Yes, a dealer financing scheme can help dealers expand their business by providing funds for purchasing additional inventory, upgrading facilities, and managing cash flow. This financial support enables dealers to grow operations, increase sales and improve overall business efficiency and profitability.
Yes, HDFC Bank levies an early repayment or premature loan closure charge of 4% p.a. + Taxes as applicable. However, as per BCSBI guidelines, for borrowers classified as Micro and Small Enterprises (MSE), the Bank does not levy any premature closure charges for all Floating Rate Loans and for Fixed Rate Loan facility up to ₹50 lakh.